We don’t foresee a shift happening in our market anytime soon. Now is still a great time to buy a home.
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Over the last few years, the market has seen high levels of appreciation. This trend has got a lot of people wondering: Are we soon going to see another market shift similar to the one we saw a decade ago?
The answer is a matter of supply and demand. Over the last few years, we’ve had a continual one to two-month supply of inventory. A balanced market should have around six months of inventory. This means there very few homes available right now. Because of this low supply, demand is high, and that will keep prices going up. Unless something dramatic happens to change that, this trend will continue.
It’s important to note that the market is different now than it was a decade ago. Back then, loose lending restrictions meant almost anyone could get a loan. This resulted in a large influx of homes people couldn’t make their payments on because they weren’t properly qualified. When those homes all hit the market at the same time, it drove up supply, lowered demand, and caused prices to drop drastically. Now, lending restrictions are tighter, and we don’t see any indication that the same thing is going to happen.
So, is it a good time to buy? Absolutely. If you would’ve purchased a home within the last few years, you would’ve gained a lot of equity in that home. If you’re unsure whether you want to buy a home at the high point of the market, supply and demand indicate we’re not at a high point because demand is still high and supply is still low. In addition to that, buying now means you can take advantage of low interest rates.
The longer you wait to buy, the more prices will rise—maybe not at the same level we’ve witnessed last few years, but they’ll rise nonetheless. In that time, interest rates will rise too.
If you think you might be interested in buying a home or you’re curious what your home might be worth, don’t hesitate to reach out to us. We’d be glad to help you.